Illegal agreements that unreasonably restrain trade are agreements that violate antitrust laws. These laws are designed to promote fair competition and prevent monopolies. There are three types of agreements that are considered illegal under antitrust laws.
1. Price Fixing Agreements
Price fixing agreements are agreements between competitors to set prices at a certain level. This is done to eliminate competition and maintain higher prices for consumers. Price fixing can take many forms, including setting a minimum price, setting a maximum price, or agreeing to only sell at certain prices. Price fixing is illegal under antitrust laws because it eliminates competition and harms consumers by keeping prices artificially high.
2. Market Allocation Agreements
Market allocation agreements are agreements between competitors to divide up markets or customers. This can be done geographically or by product line. The goal of market allocation is to eliminate competition by creating a monopoly in a particular market. Market allocation is illegal under antitrust laws because it eliminates competition and harms consumers by limiting their choices.
3. Tie-In Agreements
Tie-in agreements are agreements that require customers to purchase one product in order to purchase another product. For example, a company may require customers to purchase its software in order to use its hardware. Tie-in agreements are illegal under antitrust laws because they limit competition and harm consumers by forcing them to purchase products they may not want or need.
In conclusion, illegal agreements that unreasonably restrain trade are agreements that violate antitrust laws. These laws are designed to promote fair competition and prevent monopolies. Price fixing agreements, market allocation agreements, and tie-in agreements are all illegal under antitrust laws because they eliminate competition and harm consumers by restricting choice and keeping prices artificially high. As consumers, it`s important to be aware of these illegal agreements and report any suspected violations to the appropriate authorities.